For those running a small or medium enterprise (SME), electricity use can be a major operating cost. To help you see how your business's power use and bills stack up against others in your state or Australia, we've gone through and analysed the data from the ACCC's September 2020 Inquiry into the National Electricity Market report.
All the data in this report was collected in the third quarter of 2018 and 2019. Note that the majority of the report deals with median values – the middle value of each data set – instead of the average value. This is designed to help cancel out any outliers.
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The median quarterly bill is the value that falls right in the middle when we look at all the bills for SMEs, sorted by state. Here, we've compared median bills of businesses on market offers to those on standing offers.
For more on the difference between market and standing offers, see our guide.
State/region
Median bill (market, 2018)
Median bill (standing, 2018)
Median bill (market, 2019)
Median bill (standing, 2019)
VIC
$576
$380
$560
$295
NSW
$692
$535
$638
$448
SA
$535
$263
$497
$232
SE QLD
$593
$478
$548
$441
ALL
$624
$461
$585
$392
Bills for small and medium businesses on market offers generally dropped by about 1.5% between 2018 and 2019.
While standing offer customers look to have paid far less overall than market offer customers, this is entirely due to the fact that standing offer customers used significantly less power than those on market offers, leading to these smaller bills. Prices on standing offers remained higher overall, as shown in the next section.
What is the median usage cost for SMEs?
Usage costs are how much you pay for each unit of energy consumed, measured in c/kWh (cents per kilowatt hour). Once again, we've compared median usage rates for businesses on market versus standing offers.
Median usage cost
Standing offer customers paid an average of $424 extra/yr vs market offer customers
State/region
Median rate (market, 2018)
Median rate (standing, 2018)
Median rate (market, 2019)
Median rate (standing, 2019)
VIC
30.9c/kWh
56.7c/kWh
31.0c/kWh
46.2c/kWh
NSW
32.7c/kWh
45.4c/kWh
31.8c/kWh
42.5c/kWh
SA
40.7c/kWh
58.7c/kWh
40.3c/kWh
56.0c/kWh
SE QLD
30.0c/kWh
35.3c/kWh
28.9c/kWh
33.5c/kWh
ALL (combined)
32.8c/kWh
46.5c/kWh
32.3c/kWh
43.0c/kWh
Standing offer customers paid an average of $424 extra per year compared to market offer customers.
How much electricity are SMEs using?
Besides usage rates, the other major factor that determines your business's energy bill is how much power it's using. We've compared median power usage in kWh for businesses on market versus standing offers.
State/region
Median usage (market, 2018)
Median usage (standing, 2018)
Median usage (market, 2019)
Median usage (standing, 2019)
VIC
1,960kWh
686kWh
1,869kWh
685kWh
NSW
2,173kWh
1,187kWh
2,056kWh
1,082kWh
SA
1,412kWh
456kWh
1,331kWh
432kWh
SE QLD
2,036kWh
1,419kWh
1,913kWh
1,315kWh
ALL (combined)
1,994kWh
1,042kWh
1,881kWh
948kWh
Standing offer customers used significantly less power than those on market offers, in some cases consuming half or less the amount of power. This led to the lower overall power bills seen in the first section.
Energy is getting cheaper for SMEs
On average, SMEs are paying less in 2019 compared to the previous year, with standing rate customers paying almost 15% less and market rate customers paying 6% less.
Bill change
Market rate customers are paying
6% less
Standing rate customers are paying
15% less
Usage rates for SMEs dropped by around 3.5c/kWh for standing offer customers, and 0.5c/kWh for market offer customers, consistent with the overall lower energy bills.
Usage rate change
In 2019, Market rate SMEs are paying
0.5c/kWh LESS
In 2019, Standing rate SMEs are paying
3.5c/kWh LESS
What percentage of SME plans have a conditional discount?
There are two types of discounts:
Guaranteed discounts, which apply to your usage rates or total bill no matter what, for a certain period of time.
Conditional discounts, which only apply so long as you're meeting a particular condition, such as paying your bill on time or paying via direct debit.
This chart shows what percentage of market offer business customers were on plans with conditional discounts in particular in 2018 and 2019.
The fraction of SMEs on conditional discounts increased in every region except NSW, showing that they were still perceiving value in conditional discounts. This coincided with a reduction in conditional discount advertising due to changes in legislation.
What tariff type are SMEs on?
There are four main types of tariffs we consider here:
Flat tariff. All energy use is billed at the same rate, no matter when it is used.
Time of use tariff. Energy use is billed differently depending on time of day, divided into peak (high rate), off-peak (low rate), and possibly shoulder (medium rate) periods.
Controlled load (CL). A dedicated circuit for a high-demand appliance, like an electric hot water heater or underfloor heating. Can be combined with flat or time of use tariffs.
Demand. Customers are charged both for their peak demand on the network, plus how much power they use. Generally for larger businesses.
The pictograph below illustrates the percentage of SMEs on each tariff in 2019, by state or region.
State/region
Flat (no CL)
Flat (CL)
Time of use (no CL)
Time of use (CL)
Demand
VIC
55.7%
1.6%
38.0%
0.4%
4.4%
NSW
67.6%
3.2%
23.3%
1.2%
4.6%
SA
57.1%
5.0%
32.7%
1.0%
4.2%
SE QLD
86.6%
3.8%
8.0%
1.2%
0.4%
ALL (combined)
64.7%
2.9%
27.4%
0.9%
3.9%
In the table above, we've excluded SMEs on other tariffs than the four listed, since they made up less than 0.4% of customers in all cases.
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Sam Baran is a writer for Finder, covering topics across the tech, telco and utilities sectors. They enjoy decrypting technical jargon and helping people compare complex products easily. When they aren't writing, you'll find Sam's head buried in a book or working on their latest short story. Sam has a Bachelor of Advanced Science from the University of Sydney. See full bio
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